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AEI's weekly digest of top commentary and scholarship on the issues that matter most

After Years of Inertia

America’s Pivot to Asia Is Finally Happening

February 11, 2023

According to Hal Brands, America’s position toward Communist China has strengthened significantly since the beginning of 2023. Brands says US policymakers have made “real progress in two areas: Creating a workable defense strategy in the Western Pacific, and waging the technological cold war with Beijing.” He highlights recent developments, such as semiconductor sanctions and closer ties with the Philippines.

 

 

In his State of the Union address on February 7, President Joe Biden reintroduced several tax proposals he has previously endorsed. Kyle Pomerleau reviews these priorities, which included quadrupling the excise tax on stock buybacks and expanding the child tax credit, and identifies some potential consequences for the federal budget, businesses, and households.

 

Mackenzie Eaglen and William C. Greenwalt celebrate the Army’s embrace of multiyear procurement contracts, which Congress recently authorized, and argue that other services should follow suit. “These contracts send a steady demand signal to companies,” write Eaglen and Greenwalt, “incentivizing them to ramp up capacity, expand workforces and invest their own funds in research and development.”

 

In the latest report for AEI’s Survey Center on American Life, Daniel A. Cox finds profound shifts in Americans’ experiences of dating and relationships. Surveying more than 5,000 adults age 18 and above, Cox observes that the historic decline in marriage has been accompanied by a rise in cohabitation and the share of Americans in committed relationships who have never married.

 

The Influence of Medicare Part D on the List Pricing of Brand Drugs

In an article in the Health Services Research journal, Benedic N. Ippolito and Joseph F. Levy find that, in recent years, drugs with a high proportion of Medicare-eligible users had higher list prices than their net prices, compared to drugs not targeted at Medicare recipients. Net prices are the prices insurers pay after discounts from Medicare. According to Ippolito and Levy, higher list prices relative to net prices may mean higher out-of-pocket expenditures for patients, as a wider gulf may be advantageous for insurers, who have to pay less of the total list price. Ippolito and Levy find that, since Medicare Part D, which discounts certain drugs for insurers, came into effect and incentives have grown stronger, these higher list prices have emerged among drugs marketed to Medicare recipients. The coauthors conclude that their results “are consistent with the theory that Medicare Part D’s design encourages plans to prefer brand drugs with relatively high list prices in recent years (and for drug makers to price drugs accordingly).”

 

 

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QUOTE OF THE WEEK

I remain convinced that an authentically color-blind society—one that recognizes histories of difference but refuses to fetishize or reproduce them—is the destination we must aim for. Either we achieve genuine universalism or we destroy ourselves as a consequence of our mutual resentment and suspicion.

Thomas Chatterton Williams